Rules Proposed On Derivatives

Published: April 23, 1994

The nation's top securities firms have proposed a system of voluntary regulations for trading in derivatives.

The firms plan to work with the Securities and Exchange Commission on concerns about derivatives, contracts whose values are based on the movement of an underlying index, security or commodity.

The concerns include the protection of investors against risky contracts, the holding of enough capital to back huge derivatives holdings and increased disclosure.

"We want to make regulators feel more at ease with the way we conduct our business," said Jeffrey Seltzer, a managing director for Lehman Brothers who heads the association's committee that developed the plan.